As if there aren’t enough problems in the world, add another one: online identity fraud. It’s rampant these days, threatening anyone doing business online. As identity verification is our job, here are some things we’ve learned along the way.
June 3rd, 2019
This is the first post in a two-part anti-fraud blog series.
Chances of fraud last week? Nearly 1 percent.
With 4.4 billion people on the internet as of April, online trust is in short supply. According to Javelin Research, 14.4 million people fell victim to identity fraud in 2018.
One nasty subspecies wreaks more havoc than ever before. That’s where fraudsters open new accounts using stolen identities. From mortgages to car loans and credit cards, real people and companies get hurt, to the tune of $3.4 billion last year. According to ThreatMetrix, the fraudulent new-account trend makes global e-commerce transactions 10x riskier.
But global figures feel abstract and unrelatable. Like that asteroid with a one in a 30 million chance of hitting Earth this year.
Veriff doesn’t do global studies. We know fraud first-hand. Every day, criminals target companies that use us to check customer identities. Just last week, across our client porftfolio, 0.8 percent of verification attempts were fraudulent. We blocked them, but if you’re not properly protected, there is no safety in denial or prayers. This asteroid will hit.
No wonder identity fraud has been called a 5% global tax on business.
Identity abuse: 10-20x more prevalent than fraud
Sure, actual results vary. But in some sectors, such as cryptocurrency, identity abuse and exploitation occur far more often than “fraud”. In one client’s case, we saw abusive verification attempts reach 10-20 percent of identification traffic.
Technically, fraud and abuse are different beasts. Document fraud fakes, replicates, tampers, and scans IDs. Identity fraud uses someone else’s identity as their own. In abuse cases, criminals force people to verify themselves so the abuser can take off with their money or benefits.
For victims, fraud vs. abuse is a distinction without a difference. Whatever the label on identity crime, we must stop it. Thanks to incredible AI technology, skilled people, and a multi-layer defence strategy, we do.
More on that in our next post.